Office of House Bill AnalysisH.B. 2195
By: Kitchen
Public Education


Charter schools are public schools that receive state tax dollars, state
textbooks, and other benefits of governmental status.  In 1995, the State
Board of Education (board) established an application process for an
open-enrollment charter school and set criteria for selecting successful
applicants for the 1996-1997 biennium.  In its findings to the 77th
Legislature, the House Subcommittee on Charter Schools noted that of the
"first generation" charter schools whose applications were granted, one
failed to open, but not before the school had received more than $240,000
in state funds.  Additionally, of the number of charter schools in
operation, a number of other schools owed the state a large portion of the
funds that had been advanced and spent throughout the year.  In 1997, the
Texas Legislature authorized 100 more open-enrollment charter schools.  The
subsequent biennium saw several of the new generation of charter schools
fail.  In some cases, the sudden closing of the schools resulted in
displaced students having to repeat a grade. These closures evidence the
need for stronger financial and operational accountability requirements.
House Bill 2195 requires an open-enrollment charter school in its
application to the board to show understanding and experience regarding
financial matters and provide for an organized plan of shut-down.  The bill
also requires TEA to conduct an on-site compliance and readiness review
before the school begins to enroll students. 


It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 


House Bill 2195 amends the Education Code to require the State Board of
Education (board) to consider additional criteria relating to the financial
and operational accountability of an open-enrollment charter school
(school) prior to approving or denying the school's application for a
charter.  The bill provides that the additional criteria the board adopts
must include a requirement for the school to prepare and submit to the
Texas Education Agency (TEA) documentation from applicants that
demonstrates that: 

_school management staff have an understanding of and experience in
accounting and the provision of financial accountability reports; 

_all school board members and management staff have attended some minimum
training regarding areas from basic school laws and funding aspects to
public accountability; 

_the school possesses current and future ability to meet payrolls and other
contractual obligations; 

_the school has a reasonable plan for an organized shut down of operations
if the school ceases operation, including specified notification
requirements; and 

_the school management has a reasonable implementation plan demonstrating
preparedness of school operations before the date it plans to begin
 The bill requires TEA to respond to the plan no later than the 10th day
after the school organization submits the plan if the plan does not meet
preparedness guidelines. 

H.B. 2195 sets forth status report requirements for each school
organization approved by the board for operation and requires TEA to
conduct a compliance and readiness review of each approved school
organization.  The bill authorizes TEA to delay enrollment of students in a
school if the compliance and readiness review reveals that the school
organization is not prepared to meet contractual obligations and requires
TEA to notify a school organization of a decision to delay enrollment. 


September 1, 2001.